Would you pay attention if we told you that Stefani Germanotta allegedly failed to pay her assistant over $375,000 in overtime pay? What if we told you Stefani Germanotta usually goes by “Lada Gaga”? Reportedly, the uber-famous singer reached a settlement in the 2011 FLSA lawsuit filed by her former personal assistant. The lawsuit serves as a reminder to employers of all sizes that unless their employees meet the requirements of the administrative exemption test, they must be paid overtime under the Fair Labor Standards Act.
Jennifer O’Neill sued her former roommate, friend and boss under the FLSA, claiming she was owed approximately $380,000 in overtime. O’Neill claimed that she was on call 24-7, thus working 7,100 hours in overtime over a 15-month period. Gaga responded that much of the time worked was personal in nature, and asserted that there were long stretches in which O’Neill didn’t work at all. The singer further argued that O’Neil lived a lavish lifestyle at her expense, flying around the world, receiving clothes from famous designers, and dining at fine restaurants.
Those perks are irrelevant under the law. Unfortunately for Gaga, she admitted during her deposition that O’Neill’s position did not call for much, if any, independent discretion or judgment. Under the FLSA, employers need not pay overtime if the following administrative exemption test is met:
- The employee is compensated on a salary or fee basis at a rate of not less than $455 per week;
- The employee’s primary function must be the performance of office or non-manual work that is directly related to the management or general business operations of the employer, and
- The employee’s primary duty includes the exercise of discretion and independent judgment with respect to significant matters.
Lady Gaga failed that test and, as a result, her former assistant had a strong argument that overtime was owed. Regardless of the lavish lifestyle and free dinners, if the employee does not exercise independent judgment and discretion in matters of significance, he or she must be paid overtime. Let this be a lesson to all employers.